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[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 884 Introduced in Senate (IS)]

112th CONGRESS
  1st Session
                                 S. 884

 To amend the Internal Revenue Code of 1986 to provide for a variable 
  VEETC rate based on the price of crude oil, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                              May 4, 2011

Mr. Grassley (for himself, Mr. Conrad, Mr. Johanns, Ms. Klobuchar, Mr. 
  Franken, Mr. Johnson of South Dakota, Mr. Harkin, and Mr. Nelson of 
   Nebraska) introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
 To amend the Internal Revenue Code of 1986 to provide for a variable 
  VEETC rate based on the price of crude oil, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Domestic Energy Promotion Act of 
2011''.

SEC. 2. VARIABLE VEETC RATE BASED ON PRICE OF CRUDE OIL.

    (a) Excise Tax Credit.--
            (1) In general.--Subparagraph (A) of section 6426(b)(2) of 
        the Internal Revenue Code of 1986 is amended--
                    (A) by striking ``and'' at the end of clause (i),
                    (B) by inserting ``and before 2012'' after ``2008'' 
                in clause (ii),
                    (C) by striking the period at the end of clause 
                (ii) and inserting ``, and'', and
                    (D) by adding at the end the following new clauses:
                            ``(iii) in the case of calendar year 2012, 
                        20 cents,
                            ``(iv) in the case of calendar year 2013, 
                        15 cents, and
                            ``(v) in the case of calendar quarters 
                        beginning after 2013, the applicable rate 
                        determined in accordance with the following 
                        table:

``If the average price of crude oil            The applicable rate for 

 during the preceding calendar                 the calendar quarter is:
        quarter is:
        Not more than $50/barrel...........................   30 cents 
        More than $50 but not more than $60/barrel.........   24 cents 
        More than $60 but not more than $70/barrel.........   18 cents 
        More than $70 but not more than $80/barrel.........   12 cents 
        More than $80 but not more than $90/barrel.........    6 cents 
        More than $90/barrel...............................    0 cents.
                        For purposes of the preceding table, the 
                        average price of crude oil for any calendar 
                        quarter shall be the average 3-month futures 
                        price on the New York Mercantile Exchange for 
                        light sweet crude oil for such calendar 
                        quarter.''.
            (2) Extension of tax credit or payment.--Sections 
        6426(b)(6) and 6427(e)(6)(A) of such Code are each amended by 
        striking ``2011'' and inserting ``2016''.
    (b) Income Tax Credit.--
            (1) In general.--The table contained in section 40(h)(2) of 
        the Internal Revenue Code of 1986 is amended--
                    (A) by striking ``calendar year'' in the heading 
                for the first column,
                    (B) by inserting ``Calendar year'' before ``2001'',
                    (C) by inserting ``Calendar year'' before ``2003'',
                    (D) by inserting ``Calendar year'' before ``2005'',
                    (E) by inserting ``Calendar years'' before 
                ``2009'',
                    (F) by striking the period at the end of the table, 
                and
                    (G) by adding at the end the following:

 
``Calendar year 2012......................     20 cents  14.8 cents
Calendar year 2013........................     15 cents  11.1 cents
Any calendar quarter beginning after 2013           1st   2d applicable rate.''.
 and before 2017.                            applicable
                                                   rate
 

            (2) Applicable rates.--Paragraph (3) of section 40(h) of 
        such Code is amended to read as follows:
            ``(3) Applicable rates.--For purposes of this subsection, 
        the 1st applicable rate and the 2d applicable rate shall be 
        determined in accordance with the following table:

----------------------------------------------------------------------------------------------------------------
                                                  The 1st
 ``If the average price of crude oil during   applicable rate    The 2d applicable rate for the calendar quarter
     the preceding calendar quarter is:       for the calendar                         is:
                                                quarter is:
----------------------------------------------------------------------------------------------------------------
Not more than $50/barrel...................           30 cents  22.20 cents
More than $50 but not more than $60/barrel.           24 cents  17.76 cents
More than $60 but not more than $70/barrel.           18 cents  13.33 cents
More than $70 but not more than $80/barrel.           12 cents  8.88 cents
More than $80 but not more than $90/barrel.            6 cents  4.44 cents
More than $90/barrel.......................            0 cents  0 cents.
----------------------------------------------------------------------------------------------------------------

        For purposes of the preceding table, the average price of crude 
        oil for any calendar quarter shall be the average 3-month 
        futures price on the New York Mercantile Exchange for light 
        sweet crude oil for such calendar quarter.''.
            (3) Extension of tax credit.--Section 40 of such Code is 
        amended--
                    (A) by striking ``2011'' in subsection (e)(1)(A) 
                and inserting ``2016'',
                    (B) by striking ``2012'' in subsection (e)(1)(B) 
                and inserting ``2017'', and
                    (C) by striking ``2011'' in subsection (h)(1) and 
                inserting ``2016''.
    (c) Repeal of Deadwood.--Section 6426(b)(2) of the Internal Revenue 
Code of 1986 is amended by striking subparagraph (C).
    (d) Effective Date.--The amendments made by this section shall 
apply to any sale, use, or removal for any period after the date of the 
enactment of the Act.

SEC. 3. EXTENSION OF CELLULOSIC BIOFUEL PRODUCER CREDIT THROUGH 2016.

    (a) In General.--Section 40(b)(6) of the Internal Revenue Code of 
1986 is amended by striking subparagraph (H).
    (b) Conforming Amendment.--Section 40(e) of the Internal Revenue 
Code of 1986 is amended by striking paragraph (3).

SEC. 4. EXTENSION AND MODIFICATION OF ALTERNATIVE FUEL VEHICLE 
              REFUELING PROPERTY CREDIT.

    (a) Extension for Ethanol Refueling Property.--Subsection (g) of 
section 30C of the Internal Revenue Code of 1986 is amended--
            (1) by striking ``and'' at the end of paragraph (1),
            (2) by striking the second period at the end of paragraph 
        (2),
            (3) by redesignating paragraph (2) as paragraph (3), and
            (4) by inserting after paragraph (1) the following new 
        paragraph:
            ``(2) in the case of property relating to fuel described in 
        subsection (c)(2)(A)(ii), after December 31, 2016, and''.
    (b) Only Certain Ethanol Blends Eligible for Credit.--Subparagraph 
(A) of section 30C(c)(2) of the Internal Revenue Code of 1986 is 
amended to read as follows:
                    ``(A) Any fuel--
                            ``(i) at least 85 percent of the volume of 
                        which consists of one or more of the following: 
                        natural gas, compressed natural gas, liquified 
                        natural gas, liquefied petroleum gas, or 
                        hydrogen, or
                            ``(ii) at least 85 percent of the volume of 
                        which consists of--
                                    ``(I) ethanol, or
                                    ``(II) ethanol and one or more of 
                                the fuels described in clause (i), but 
                                only if at least 20 percent and not 
                                more than 85 percent of the volume of 
                                such fuel consists of ethanol.''.
    (c) Credit for Dual-Use Refueling Property.--Subsection (e) of 
section 30C of the Internal Revenue Code of 1986 is amended by adding 
at the end the following new paragraph:
            ``(6) Dual-use refueling property.--
                    ``(A) In general.--In the case of any dual-use 
                refueling property, 100 percent of the cost of such 
                property shall be treated as qualified alternative fuel 
                refueling property if the taxpayer certifies, in such 
                time and manner as the Secretary shall prescribe, that 
                such property will be used in more than a de minimis 
                capacity for the purposes described in section 
                179A(d)(3)(A) (applied as specified in subsection 
                (c)(2)).
                    ``(B) Recapture.--If at any time within 5 years 
                after the date of the certification under subparagraph 
                (A) the dual-use refueling property ceases to be used 
                as required under such subparagraph, 100 percent of the 
                cost of such property shall be subject to recapture 
                under paragraph (5).
                    ``(C) Dual-use refueling property.--For purposes of 
                this paragraph, the term `dual-use refueling property' 
                means property that is both qualified alternative fuel 
                vehicle refueling property and property used--
                            ``(i) to store or dispense fuels not 
                        described in subsection (c)(2), or
                            ``(ii) to store fuels described in 
                        subsection (c)(2) for any purpose other than 
                        delivery of such fuel into the fuel tank of a 
                        motor vehicle.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 2011.

SEC. 5. EXTENSION OF SPECIAL DEPRECIATION ALLOWANCE FOR CELLULOSIC 
              BIOFUEL PLANT PROPERTY.

    Subparagraph (D) of section 168(l)(2) of the Internal Revenue Code 
of 1986 is amended by striking ``January 1, 2013'' and inserting 
``January 1, 2017''.

SEC. 6. STAGED REDUCTION OF ETHANOL TARIFF.

    (a) Calendar Year 2012.--
            (1) In general.--Heading 9901.00.50 of the Harmonized 
        Tariff Schedule of the United States is amended--
                    (A) by striking ``14.27 cents'' and inserting 
                ``5.28 cents'' in the column 1 general rate of duty and 
                in the column 2 rate of duty; and
                    (B) by striking ``Before 1/1/2012'' and inserting 
                ``Before 1/1/2013''.
            (2) Effective date.--The amendments made by paragraph (1) 
        shall take effect on January 1, 2012.
    (b) Calendar Years 2013 Through 2016.--
            (1) In general.--Heading 9901.00.50 of the Harmonized 
        Tariff Schedule of the United States is amended--
                    (A) by striking ``5.28 cents'' and inserting 
                ``3.96 cents'' in the column 1 general rate of duty and 
                in the column 2 rate of duty; and
                    (B) by striking ``Before 1/1/2013'' and inserting 
                ``Before 1/1/2017''.
            (2) Effective date.--The amendments made by paragraph (1) 
        shall take effect on January 1, 2013.
                                 <all>
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